Pakistan’s electricity sector could cut CO2 emissions by 63% by 2035, models show

Pakistan, one of the world’s fastest-growing transitional economies, could slash its electricity-related carbon dioxide emissions by 63.40 percent between 2025 and 2035 if it follows a low-carbon electricity pathway, according to a new modeling study published in Frontiers in Sustainable Energy Policy. The research, led by Muhammad Yousaf Raza of Shandong Technology and Business University together with Boqiang Lin of Xiamen University and Qasim Javed of the University of the Punjab, combines two well-established analytical tools—the Logarithmic Mean Divisia Index (LMDI) decomposition method and the Long-range Energy Alternatives Planning (LEAP) system—to trace four decades of electricity generation and project the country’s decarbonization future under its Energy Vision 2035 agenda.

The study addresses a question that has become urgent for developing economies worldwide: how can a nation expand electricity access to power industrialization and urbanization while simultaneously bending its emissions curve downward? Pakistan offers a striking case. The country accounted for 0.6 percent of global CO2 emissions in 2018, ranking twenty-seventh among the world’s emitters, and its electricity sector alone reached 155.55 MtCO2 in 2024, with oil, coal, and natural gas contributing 65, 41.9, and 48.75 MtCO2 respectively. Compounding the problem, Pakistan imports roughly 88.87 percent of its fossil fuels from the Gulf region, tying its energy security to volatile international markets and a growing import bill.

To untangle the drivers of low-carbon electricity generation (LCEG), the team applied the LMDI decomposition technique to annual time-series data spanning 1985 to 2024, organized around Pakistan’s Five-Year National Economic Planning periods. Rather than relying on econometric models that estimate statistical relationships, decomposition analysis mathematically breaks down changes in low-carbon electricity into six distinct contributing factors: the low-carbon structure of the electricity mix, electricity generation intensity, energy security, energy intensity, carbon productivity, and CO2 emissions themselves. The method’s chief advantage is that it produces complete, residual-free attributions—every unit of change in low-carbon electricity generation can be assigned to one of the six factors, making the results directly interpretable for policymakers.

The decomposition results reveal a turning point. Over the full four decades, aggregated low-carbon electricity generation grew by 415.95 Mtoe, with positive and significant growth in every planning period except 1995 to 1999, when a consumption boom spurred electrical appliance use and energy imports. The most dramatic gains came in the current 2020 to 2024 period, which recorded 167.68 Mtoe of growth. The low-carbon structure factor alone contributed 157.20 Mtoe in this phase, reflecting the start of the China-Pakistan Economic Corridor (CPEC) power projects that have filled historical gaps in electricity production. Before 2013, renewable energy was essentially absent from Pakistan’s electricity mix; today, hydro, nuclear, renewable, and thermal sources account for 25.4, 8.4, 6.8, and 59.4 percent of generation respectively, according to the Pakistan Economic Survey 2023-2024.

The carbon productivity factor tells an equally important story about the economy itself. When carbon productivity rises, a nation generates more economic output per unit of CO2 emitted—the hallmark of decoupling growth from pollution. The study found positive trends in several planning phases, indicating that Pakistan’s economy is improving due to substantial advancements in low-carbon electricity generation. A clear reduction of 23.77 percent in the current phase suggests the country is making genuine progress toward commitments such as the Paris Agreement. Meanwhile, the CO2 emissions factor showed aggregated emissions of 462.90 Mt affecting low-carbon electricity generation over 1985 to 2024, though the most recent phase recorded a reduction of 0.49 percent, equivalent to 35.94 Mt.

For the forward-looking half of the analysis, the researchers turned to the LEAP model, an energy-environment simulation framework developed at the Stockholm Environment Institute. LEAP operates as a bottom-up accounting framework that tracks both demand-side and supply-side technologies, simulating how electricity is generated, substituted, and consumed under different assumptions about fuel types—hydro, thermal, nuclear, and renewable. The team calibrated the model with 2013 as the base year, chosen deliberately because renewable electricity from biofuels, solar, and wind first entered Pakistan’s mix that year, and extended projections to 2035 under three scenarios: business as usual (BAU), low demand, and high demand, each tested at a 5 percent significance level.

The demand scenarios expose the divergent fates of each fuel. Total electricity consumption, which grew from 6.25 Mtoe in 2013 to 9.60 Mtoe in 2024, is projected to keep expanding through 2035. Hydroelectricity shows a zigzag pattern with modest average growth of 0.14 percent between 2025 and 2035, constrained by precipitation variability and water security concerns. Thermal electricity, by contrast, is the clear loser: it declined by 0.58 percent annually from 2013 to 2024 and is projected to fall by 0.85 percent on average through 2035, with a 3 percent decline by 2035 under the low-demand scenario as renewable substitution takes hold. Nuclear electricity demand, which grew 4.85 percent from 2013 to 2024, continues rising at 0.77 percent through 2035, while renewable energy—solar, wind, and biomass—grew 7.62 percent during the historical period and is projected to advance at 0.75 percent on average through the forecast window.

The headline finding emerges from the CO2 mitigation scenario. Under the low-demand pathway, in which all low-carbon electricity sources except thermal operate at full advantage and no power plants run below capacity, electricity-related CO2 emissions fall by 6.45 percent yearly between 2013 and 2035, even as electricity output increases at an average rate of 4.34 percent per year. If the maximum share of low-carbon electricity becomes available from 2025 onward, the reduction in CO2 emissions until 2035 reaches 68.551 percent in the mitigation scenario, with the abstract’s headline figure of 63.40 percent representing the projected cut under the study’s central assumptions. Thermal generation turns negative in the projections from 2025 onward, meaning fossil-based electricity is progressively displaced rather than merely reduced.

The policy implications are concrete. The authors recommend long-term investment in renewable energy technologies and dam reconstruction for hydroelectricity, noting that roughly 250 engineering structures—including dams, ponds, spillways, and drainage systems—are under consideration to raise electricity efficiency. Pakistan has set a target to mitigate carbon emissions by 50 percent by 2030, and the government has committed to adding about 6,000 MW of photovoltaic solar capacity to accelerate pollution reduction from energy generation. The Private Power Infrastructure Board is currently easing 24 power generation projects, 22 of which are based on renewable energy, signaling that the regulatory framework is shifting toward incentivizing private sector investment in clean electricity.

For a country long trapped between expensive fuel imports and chronic power shortages, the study’s message is that decarbonization and energy security are not competing goals but mutually reinforcing ones. Substituting fossil fuel electricity with hydro, nuclear, wind, biofuels, and photovoltaic solar simultaneously cuts emissions, reduces exposure to Gulf oil and gas markets, and strengthens domestic energy self-sufficiency. The researchers acknowledge limitations—low-carbon electricity costs and sectoral cost information were not available—and call for future work using machine learning approaches for renewable energy, load, and cost forecasting, incorporating external inputs such as population, income, and technology. But the core conclusion stands: with disciplined carbon mitigation policies and sustained technical development, a transitional economy can grow its electricity system fourfold in output terms while cutting its carbon footprint by nearly two-thirds within a single decade.

Subject of Research: Low-carbon electricity generation and CO2 emission mitigation scenarios for Pakistan's electricity sector through 2035

Article Title: Low-carbon electricity generation through demand and carbon neutrality prediction 2035 of a transitional economy: decomposition and LEAP learning approaches

Article References: Low-carbon electricity generation through demand and carbon neutrality prediction 2035 of a transitional economy: decomposition and LEAP learning approaches. (n.d.). https://doi.org/10.3389/fsuep.2026.1766522

Image Credits: AI Generated

DOI: 10.3389/fsuep.2026.1766522

Keywords: Pakistan, low-carbon electricity, CO2 emissions, LMDI decomposition, LEAP model, Energy Vision 2035, renewable energy, carbon neutrality, electricity demand scenarios, energy security, CPEC, decarbonization